The Wealth and Poverty of Nations: Why Some Are So Rich and Some So Poor (W W Norton & Company; 1998)

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WINNERS AND^485

to twenty-four hours in an American plant.^22 This strategy had
profound implications for labor-management relations. American
emphasis on single-purpose machines and hard assignments had the
effect of deskilling; it also led unions to insist on job segmentation
and management to accept it.
Multiple models, of course, multiplied inventories, and inventory
idles capital, increases storage costs, invites delays. Where American
car makers, with their long runs and rare changeovers, dreaded
interruption (from strikes, for example) and accumulated a buffer of
ready components, Japanese makers strove to minimize stocks by
using the system we know as "just in time."* The idea, we are told,
came from visits to the United States—not to the automobile plants
but to the supermarkets, with their extraordinary diversity of
products. They watched American housewives, who kept track and
bought as needed; and the markets also kept track and did the same.
The goods were pulled through rather than pushed. Why couldn't
cars be made that way? (They were, in American auto plants, but the
Japanese refined a procedure that had room for improvement. ) All of
these ideas testify to the value of curiosity, observation, and lateral
thinking; in short, to the importance of the human actor.^23
The Japanese also worked to exclude error, aiming at the
unreachable goal of zero defects. Instead of pulling cars off the line,
they tried to catch the mistake when it happened, stopping the line if
necessary. That might have been expensive, but the point was to
prevent rather than repair. "Where are the inspectors?" asked an
American visitor. "We have no inspectors," came the answer. "The
workers do it."
These innovations completely turned around Japan's reputation as
manufacturer; whereas before the war, the Japanese had been
associated with five-and-dime ticky-tacky and tin-can vehicles, now
their products were quality leaders. American car manufacturers
found it hard to accept the new reality, clinging to their cherished
stereotypes past the point of no return. They also ridiculed the idea
of small cars; the very name "Toyota" made them smile. Americans,


* The role of labor conflict and its interruptions is crucial. Ford, in the heyday of the
$5 dollar wage and patriarchal management (1910s and early '20s), could afford to
squeeze inventories from the 204 days of 1903 to 17 days in 1922. In general, write
Abernathy and Clark, "Notes on a Trip," p. 36, "Japanese practice has not extended
process rationalization too far beyond the state of the art ... in Ford's Rouge River
facility during the 1920s."
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